Funds received from sources other than the state of Michigan (general operating funds) by the University in support of various academic and/or research programs must be placed in the proper category for administrative and accounting purposes. In order to accomplish this, the University has defined the two broad categories of grants/gifts and grants/contracts, into which it will place these funds.
A grant/gift is defined as something which is voluntarily given to the University and the University is not obligated to provide any deliverables (e.g. technical reports, software, hardware) to the donor. A grant/gift includes awards having no expectation of economic benefit nor in which any tangible compensation to the grantor exists or is implied. Most monies received from private or corporate foundations are in this category. Monies in support of research are, according to University policy, assessed indirect cost charges. However, in the grant/gift category, the University will negotiate a waiver of these indirect costs.
A grant/contract is defined as a formal agreement between the University and one or more parties for the performance of work at a fixed or reimbursable rate, this agreement will be in writing and is enforceable by law. The University is required to provide deliverables (e.g. technical reports, software, hardware) to the funding parties. Most state and all federal research projects are in this category. Normally funds in this area will be charged indirect costs at the current University rate.
Most funds received by the University will be easily defined and can be placed in the proper category. However, in those cases where definition is questionable, the University, through the appropriate administrative office, will contact the donor/sponsor for additional information to determine the proper categorization.